The Murky World Of Secondhand Diabetic Test Strips

Dec 22, 2016
Originally published on March 24, 2017 3:06 pm

Chelsea Arnold was getting into debt over tiny pieces of plastic: diabetic test strips. When Arnold was first diagnosed with diabetes she needed to test her blood sugar 10 times a day. She went to Wal-Mart and found that one box, which contained only a five-day supply of test strips, was $80. Arnold called her parents and told them she didn't know what to do. She didn't have the money.

Arnold then did what a lot of people do when they need help: She searched on Google. She typed in the words "cheap test strips," and Craigslist came up. She bought eight boxes for less than $100. At Wal-Mart, she would have paid $640. Arnold said, "it was like having a life sentence and then realizing that there's a cure."

With this Google search, Arnold stumbled into an underground economy for diabetic supplies. It's a market that offers a lower-cost option for test strips, though it is hard for customers to know where the boxes come from. Some boxes may be repackaged and unsafe to use, and some boxes are sold by diabetics who are desperate for cash. But many of them come from people who have health insurance and have accumulated extra test strips.

Trey falls into this category. (He asked us not to use his last name, because he fears retribution from his insurance company, even though he feels he hasn't broken any laws.) He moved from one type of blood sugar monitoring system to another type of monitoring system and ended up with 20 extra test strip boxes.

At that point, Trey began researching. He said, "Obviously No. 1: Is it legal to be able to sell test strips?" Trey realized that it is legal, with a caveat. "It's kind of a gray market as long as you don't get them from Medicare and Medicaid," he said. Trey then found a local buyer on Craigslist.

It starts to look a little seedy here. He put the 20 boxes in a brown paper lunch bag. "When I went to sell the test strips we met in a McDonald's parking lot," Trey said. "I came out with the bag full of test strips, and he had his wallet full of money and it was like we were doing a geriatric drug deal in the McDonald's parking lot to get rid of some test trips."

Trey made $300 off the geriatric drug deal. He jokingly calls the cash he made "blood money." He used his "blood money" to buy Christmas presents for his kids.

As far as we can tell, his test strips went on to the next stop: a gray market middleman, something like a wholesaler, someone like Christa Kral. Along with her cousin, Kral purchases diabetic test strips from people like Trey. Their website is called sellusdiabeticteststrips.com.

To advertise, Kral used to post fliers near the train station in her town. Now her ads are online. She thinks the company's unusual tagline has also brought in customers: "Two moms will buy your test strips."

Kral operates her business out of her dining room. She has a cardboard box with about 20 boxes of test strips inside. She might pay $50 a box. It depends on the brand, the condition of the box, and the expiration date for the test strips.

Then she sells them at a markup to the next part of this chain: retailers. Arnold, the woman who bought test strips off Craigslist because they were too expensive at Wal-Mart, is now a retailer. That time when she couldn't afford her test strips and keep her blood sugar in check — it scared her, and it made her decide to change her career path.

Arnold had been planning to go to medical school. But "that's what really made me think I shouldn't be a doctor and that I should go and help people try to afford the test strips," she said.

Arnold started a website, glucomart.com. It's a place where people can buy affordable test strips. She turned her garage into a kind of pharmacy. Her floor is epoxied, and she has pharmacy shelves.

Arnold realizes that if manufacturers or insurance companies lowered the price of test strips, she could be put out of business. She's actually OK with that, because, she said, "the business exists to help people afford the test strips they need."

Arnold would be happy to go back to her original plan and trade in her pharmacy shelves for a doctor's coat.

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A question from a listener in Tallahassee, Fla., inspired this next story. He wanted to know about the signs he'd seen around town. They offered cash not for old furniture or jewelry, but for certain a medical supply. Rhaina Cohen of NPR's Planet Money team unraveled the mystery behind the ads.

RHAINA COHEN, BYLINE: Chelsea Arnold was getting into debt over tiny pieces of plastic - diabetic test strips. Chelsea had just been diagnosed with diabetes, and now she needed to test her blood sugar 10 times a day. So she went to Wal-Mart. One box of test strips was $80.

CHELSEA ARNOLD: And that's a five-day supply. I called my parents, you know, and I was like, I don't know what to do 'cause I don't have that kind of money.

COHEN: So she typed a few words into Google.

ARNOLD: Cheap test strips (laughter) - and Craigslist came up.

COHEN: She bought eight boxes for less than a hundred dollars. Those would have cost $640 at Wal-Mart.

ARNOLD: It was, like, you know, having a life sentence, and then realizing that there's a cure.

COHEN: Chelsea stumbled into this underground economy for diabetic supplies. It's hard to know where the test strips come from. Some were probably sold by diabetics who were desperate for cash. Many of them, though, come from people who have insurance and have extra test strips - people like Trey, who doesn't want his last name used. He doesn't think he broke any laws, but Trey's afraid of retribution from his insurance company. When Trey moved to a different type of monitoring system, he ended up with 20 boxes of extra test strips.

TREY: Started doing some research. You know, obviously number one - is it legal to be able to sell test strips? But it turns out that that you can sell - it's kind of a gray market - as long as you don't get them for Medicare and Medicaid.

COHEN: Trey's right. It's illegal to sell test strips you get for Medicare or Medicaid, but otherwise, it's kind of gray area. So Trey found a local guy on Craigslist. It starts to look a little seedy here. He put the 20 boxes into a brown paper lunch bag.

TREY: When I went to sell the test strips, we met in a McDonald's parking lot. I came out with the bag full of test strips, and he had his wallet full of money. And it was like we were doing a geriatric drug deal in the McDonald's parking lot to get rid of some test strips.

COHEN: Trey made $300 off that geriatric drug deal.

TREY: It's like blood money, you know, technically, with the test strips.

COHEN: Blood money - Trey used it to buy Christmas presents for his kids. His test strips went on to the next stop, a buyer, someone like Christa Kral, who started a website with her cousin.

CHRISTA KRAL: Sellusdiabeticteststrips.com.

COHEN: Christa used to post flyers near the train station. Now all of her ads are online. She also thinks she brings in customers with the company's unusual tagline.

KRAL: Two moms will buy your tests strips.

COHEN: I'm in Christa's dining room, which is also the headquarters of her business. She has a cardboard box with about 20 boxes of test strips inside. Each is about the size of a box of Band-Aids, and she pays quite a bit for each of these.

KRAL: Maybe $50 a box.

COHEN: Then she sells them at a mark-up to the next part of this chain, to people like Chelsea, the woman who bought test trips off Craigslist because they were too expensive at Wal-Mart. That time when Chelsea couldn't afford her test strips and keep her blood sugar in check - it scared her, and it made her decide to change her career path. She had been planning to go to medical school.

ARNOLD: That's what really made me think I shouldn't be a doctor, and I should go and help people try to afford the test strips.

COHEN: She started a website, glucomart.com, a place where people could buy affordable test strips. She turned her garage into a kind of pharmacy.

ARNOLD: The floor is epoxied, and I have the pharmacy shelving.

COHEN: Chelsea realizes that if manufacturers or insurance companies lower the price of test strips, she could be put out of business. She's actually OK with that.

ARNOLD: Really the business exists to help people get the test strips they need.

COHEN: And she'd be happy to go back to her original plan and trade in her pharmacy shelves for a doctor's coat. Rhaina Cohen, NPR News. Transcript provided by NPR, Copyright NPR.